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A1139
ASSEMBLY, No. 1139
STATE OF NEW JERSEY
222nd LEGISLATURE
�
PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION
Sponsored by:
Assemblyman JOE DANIELSEN
District 17 (Middlesex and Somerset)
SYNOPSIS
���� Creates new taxable category of alcoholic beverages
called flavored malt beverages, imposes separate rate of taxation on new
category pursuant to alcoholic beverages tax and allocates associated revenue.
CURRENT VERSION OF TEXT
���� Introduced Pending Technical Review by Legislative
Counsel.
��
An Act
creating a new taxable category of alcoholic
beverages called flavored malt beverages, imposing a separate rate of taxation
on flavored malt beverages pursuant to the alcoholic beverages tax and
allocating the associated revenue, amending R.S.54:41-2, R.S.54:43-1 and P.L.1990,
c.41.
����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:
���� 1.��� R.S.54:41-2 is amended
to read as follows:
���� 54:41-2.����� As used in this
subtitle:
���� "Alcoholic
beverages" means liquors, beer, wines and sparkling wine, as defined in
this section.
���� "Beer" means beer,
lager beer, ale, stout, porter, and all similar fermented malt beverages having
an alcoholic content of one-half of one per centum (1/2 of 1%) or more by
volume
, but does not include flavored malt beverage
.
���� "Bonded warehouse"
means the warehouse of any licensed manufacturer or licensed wholesaler or
licensed warehouseman for which the licensee has given special security to
obtain certain privileges given by this subtitle.
���� "Bureau" means the
Beverage Tax Bureau of the Division of Taxation in the State Department of the
Treasury.
���� "Cider" means a
beverage made from the alcoholic fermentation of the juice of apples, including
but not limited to flavored, sparkling or carbonated cider.
���� "Commissioner,"
"State Tax Commissioner" or "Director" means the Director
of the Division of Taxation in the State Department of the Treasury.
���� "Container" means
the receptacle immediately surrounding the alcoholic beverage and not the
carton, box, case, sack, bag or other covering in which such containers may be
packed, placed, or transported.
���� "Department,"
"State Tax Department," or "Beverage Tax Bureau" means the
Division of Taxation in the State Department of the Treasury.
����
�Flavored malt beverage�
means a beverage having an alcoholic content of one half of one per centum (1/2
of 1%) or more by volume for which the producer is required to file a formula
for approval with the United States Alcohol and Tobacco Tax and Trade Bureau
pursuant to section 25.55 of title 27, Code of Federal Regulations.
���� "Licensed
manufacturer" means any person holding a valid and unrevoked brewery,
winery, distillery, or rectifier's license issued pursuant to the provisions of
any relevant law of this State.
���� "Licensed
transporter" means any person holding a valid and unrevoked license or
permit to transport alcoholic beverages pursuant to the provisions of any
relevant law of this State.
���� "Licensee" means the
holder of any valid and unrevoked license or special permit issued pursuant to
any relevant law of this State, pertaining to alcoholic beverages.
���� "Liquors" means all
distilled or rectified spirits, alcohol, brandy, whisky, rum, gin and all
similar distilled alcoholic beverages, including all dilutions and mixtures of
one or more of the foregoing, such as liqueurs, cordials, and similar compounds,
having an alcoholic content of one-half of one per centum (1/2 of 1%) or more
by volume.
���� "Manufacturer" means
any person holding a valid and unrevoked brewery, winery, distillery,
supplemental limited distillery, or rectifier and blender's license, issued
pursuant to the provisions of any relevant law of this State.
���� "Person" means a
natural person, an association, a partnership or a corporation.
���� "Plenary retail transit
licensee" means any person holding a valid and unrevoked plenary retail
transit license issued pursuant to any relevant law of this State, authorizing
the sale of alcoholic beverages for consumption only, on railroad trains,
airplanes, and boats, while in transit in this State.
���� "Return" means the
return of alcoholic beverages by a customer to the source from which such
beverages were obtained, upon the cancellation of a sale, and shall include:
(a) actual receipt of the beverages on the licensed premises of the source or
in a licensed public warehouse for the account of the source; or (b) the
sending of the beverages by the customer to another person upon instructions of
the source; but shall not include any other disposition, such as samples,
breakage, shortage, merchandising credits, or beverages dumped on the premises
of the customer, except where such dumping is done under the supervision of the
director or his representative.
���� "Sale" means and
includes, in addition to its ordinary meaning, any exchange, gift, loss, theft,
or other disposition. In every case where alcoholic beverages are exchanged,
given, lost, stolen or otherwise disposed of, they shall be deemed to have been
sold, unless, in case of loss by fire, proof is furnished to the satisfaction
of the commissioner, that the alcoholic beverages have been so destroyed that
they could not have been put to any use.
���� "Sparkling wine"
means champagne and other effervescent wine charged with carbon dioxide,
whether artificially or as the result of secondary fermentation of the wine
within the container.
���� "State licensee"
means any person holding a valid and unrevoked license or special permit,
issued by the Director of the Division of Alcoholic Beverage Control, and who
has posted a bond with the director to secure the payment of the alcoholic beverage
taxes.
���� "Taxpayer" means a
person chargeable with the payment of a tax pursuant to the provisions of this
subtitle.
���� "Transportation
licensee" means any person holding a valid and unrevoked license or
special permit to transport alcoholic beverages pursuant to the provisions of
any relevant law of this State.
���� "Treasurer" means
the Treasurer of the State of New Jersey.
���� "Vermouth" means any
compound made by the mixture of extracts from macerated aromatic flavoring
materials with wines and manufactured in such manner that the product possesses
the taste, aroma, and characteristics generally attributed to vermouth.
���� "Warehouse receipt"
means a certificate or receipt given upon the storage of alcoholic beverages in
a United States custom or United States internal revenue warehouse under
federal bond.
���� "Warehouse receipts
licensee" means any person holding a valid and unrevoked warehouse
receipts license issued pursuant to any relevant law of this State.
���� "Wines" means all
wines whether known as "dry wines," "sweet wines,"
"still wines," or "fortified wines" and any artificial or
imitation wine or compound sold as wine, and any fruit juice containing one-half
of one per centum (1/2 of 1%) or more of alcohol by volume, and any other
beverage containing alcohol produced by the fermentation of the natural sugar
content of fruits or other agricultural products containing sugar, which
beverage contains one-half of one per centum (1/2 of 1%) or more of alcohol by
volume, but shall not mean or include vermouth, or cider containing less than
three and two-tenths per centum (3 2/10 %) of alcohol by volume.
(cf: P.L.1997, c.153, s.1)
���� 2.��� R.S.54:43-1 is amended
to read as follows:
���� 54:43-1.����� Tax rates. There
are hereby levied and imposed upon any sale of alcoholic beverages made within
this State or upon any delivery of alcoholic beverages made within or into this
State the following excise taxes:
���� a.���� Beer--From July
1, 1990 through June 30, 1992, at the rate of $0.10 a gallon or fraction
thereof and on or after July 1, 1992, at the rate of $0.12 a gallon or fraction
thereof.
���� b.��� Liquors--From July 1,
1990 through June 30, 1992, at the rate of $4.20 a gallon, on or after July 1,
1992 through July 31, 2009, at the rate of $4.40 a gallon and on or after
August 1, 2009, at the rate of $5.50 a gallon.
���� c.���� (Deleted by amendment,
P.L.1972, c.53.)
���� d.��� (Deleted by amendment,
P.L.1972, c.53.)
���� e.���� Wines, vermouth and
sparkling wines--From July 1, 1990 through June 30, 1992, at the rate of $0.50
a gallon, on or after July 1, 1992 through July 31, 2009, at the rate of $0.70
a gallon; and on or after August 1, 2009, at the rate of $0.875 a gallon, provided
however, that cider containing at least three and two-tenths per centum (3 2/10
%) of alcohol by volume but not more than 7 per centum (7%) of alcohol by
volume shall be taxed at the rate of $0.15 a gallon.
����
f.���� Flavored malt
beverages--at the rate of $4.40 a gallon.
(cf: P.L.2009, c.71, s.1)
���� 3.��� Section 2 of P.L.1990,
c.41 (C.54:43-1.1) is amended to read as follows:
���� 2.���
a.
� Beginning on
July 1, 1992, there shall annually be deposited in the Alcohol Education,
Rehabilitation and Enforcement Fund established pursuant to section 3 of
P.L.1983, c.531 (C.26:2B-32), the sum of $11,000,000 of the tax collected
annually pursuant to the "Alcoholic Beverage Tax Law," R.S.54:41-1 et
seq.�
����
Amounts deposited in the
Alcohol Education, Rehabilitation and Enforcement Fund pursuant to subsection b.
of this section shall not be included in calculating the total deposited
pursuant to this subsection.
�
����
b.��� Beginning on the
first day of the second month following the date of enactment of P.L.��� c.��
(C.������� ) (pending before the Legislature as this bill), the sum of all tax
collected annually on flavored malt beverages pursuant to the "Alcoholic
Beverage Tax Law," R.S.54:41-1 et seq. shall be divided in two equal
halves for deposit.� One half shall be deposited in the Alcohol Education,
Rehabilitation and Enforcement Fund established pursuant to section 3 of
P.L.1983, c.531 (C.26:2B-32).� The second half shall be deposited in the
General Fund.� If it is impracticable to divide the sum of all tax collected
annually on flavored malt beverages pursuant to the "Alcoholic Beverage
Tax Law," R.S.54:41-1 et seq. in two equal halves due to the collection of
an odd-numbered sum, the nominally larger half shall be deposited in the
Alcohol Education, Rehabilitation and Enforcement Fund established pursuant to
section 3 of P.L.1983, c.531 (C.26:2B-32).
(cf: P.L.1990, c.41, s.2)
���� 4.��� This act shall take
effect immediately, provided however sections 1 and 2 shall remain inoperative
until the first day of the second month following the date of enactment.
STATEMENT
���� This bill creates a new
taxable category of alcoholic beverages called flavored malt beverages, imposes
a separate rate of taxation on flavored malt beverages pursuant to the
alcoholic beverages tax and allocates the associated revenue evenly between the
Alcohol Education, Rehabilitation and Enforcement Fund and the General Fund.�
���� Though produced in a manner
which incorporates certain aspects of beer brewing, much of the flavoring and
alcohol in flavored malt beverages is derived from the addition of distilled
spirits.� This production process has the effect of creating an alcoholic
beverage that is sufficiently beer-like to be taxed like beer, but sold as
something else entirely.� Alcoholic lemonades, alcoholic colas and cooler-type
products are examples of such products.
���� This bill creates a new
category of alcoholic beverages entitled flavored malt beverages for purposes
of the alcoholic beverages tax.� The new flavored malt beverage category is
taxed at a rate of $4.40 per gallon to account for its reliance on distilled
spirits during the production process.� The bill also calls for the proceeds
derived from this new category to be allocated evenly between the Alcohol
Education, Rehabilitation and Enforcement Fund and the General Fund.